they didn't have armor. so if we do sequestration on top of what we're already trying to cut in the defense department, we will destroy the finest military in the history of the world at a time we need it the most. this is a body known for doing some pretty dumb things. this would be the -- the prize. so what senator mccain and kyl and myself are trying to do is avoid sequestration before the first of the year so our defense people can plan, and if we do not set this aside before the election, that's political malpractice. so senator mccain, senator kyl, thank you for your leadership. mr. mccain: i'd like to add, and i note the presence of the senator from new hampshire, who has always played a very key leadership role, including working with the mayors of every city in america who have issued a resolution about their concern about this issue.

i would also like to state to my friends and colleagues that i know that the chairman of the armed services committee, who i've had the opportunity of working with for 25 years, the senator from michigan, also shares our concern. i hope that weekd at least -- we could at least get some of us together that have been involved with these issues of national security for so many years on both sides of the aisle that we could reach some kind of an agreement. we know that additional sacrifices have to be made when we're facing a $16 trillion deficit. but to take the overwhelming majority, well over 50% of these reductions out of what is about i believe 12% of our spending, is obviously not a appropriate. and one other point. if the president of the united

states shares the concern that the secretary of defense shares -- catastrophic, impossible to plan on, so draconian that it would cripple our ability to defend this nation. all of those are statements that the secretary of defense has ma. i would argue that it would be appropriate, and i would sincerely ask that perhaps the president of the united states also be involved and members of his administration or charter members of the administration to sit down with us to see how we could resolve this. so far, the executive branch has not been involved in these efforts with the exception of the secretary of defense, who has told us in the most graphic terms the devastating consequences. and again i want to point out to my colleagues, you have to plan. especially in national defense. what weapons you're going to

procure, what the number of people you're going to maintain in the military, what those missions are going to be. all of those right now, if not held in abeyance in the pentagon as far as planning is concerned, cannot have a great deal of validity if we are staring at sequestration and these draconian reductions. yes, i know the senator from new hampshire -- our most eloquent member has arrived on the floor. not to mention other attributes that we are lacking in. mr. graham: i would like all three of you to comment on this proposition. you've just challenged the president -- who is the chief, by the way, -- to fix a problem that your secretary of defense has said would be the most devastating thing possible to our ability to defend ourselves. he said it would be catastrophic, it would be draconian, there's no way to plan for it, we'd be shooting ourselves in the head.

now, mr. president, you're the commander in chief. when your department secretary e and every general under your command is telling you and the congress you need to fix this before it gets out of hand, why aren't you asking us as republicans and democrats to answer the call of the secretary of defense? you're the commander in chief, my friend. it is your job to make sure that our military has what it needs to go fight wars that we send them to fight and protect our nation. but that's not enough. it is also our job as members of congress to take care of those who serve. so to our republican and democratic leader, why don't you convene a group of senators and to our leaders in the house, why don't you get a group of house members and ask us to come up with a plan to do at least one thing -- avoid the consequence of sequestration for one year in 2013 to take the mok

monkey off their back. i am willing to meet -- i am willing to meet our democrats in the middle to offset the nondefense spending but to the leaders, if you think the rest of us are going to sit on the sidelines and let this matter be taken up in lame duck when it becomes a nightmare for the country, you can forget it. so we're challenging our leaders and the president to get a group together to fix this. senator mccain, do you think that's a good idea or not? mr. mccain: i know it's the only way we're going to sox sofl this. i ask unanimous consent the senator from new hampshire be included and i know the senator from tennessee, snore corker -- -- shall senator corker is waiting. the senator from south carolina has stated the problem and a solution here. the problem is we face devastating impact on our national security. the solution is for our leaders

and the president, if possible, convene a group of senators, whether it includes us or not is immaterial on both sides of the aisle on both sides of the capitol to sit down and work out so we can avoid this sequester. i will take responsibility for a sequester if that's what's necessary. but i will also say without concrete, significant, and meaningful action to cause this sequester to be prevented, we are risking the lives of our young men and women serving in the military. i don't know of a greater responsibility that we have. i ask the senator from new hampshire if she --. the presiding officer: the senator from new hampshire is recognized. ms. ayotte: i join with my colleagues over the concern, deep concern that keeps me up at night about sequestration because we cannot do this to our national security. and both sides of the aisle have to come together. we need leadership from our

commander in chief on this issue. because to put it in perspective, i asked the assistant commandant of the marine corps what the impact of sequestration would be on the marines and you know what he told me? that the marine corps of the united states of america would be unable to respond to one major contingency. talk about putting our country at risk. and putting ourselves in a situation where, unfortunately, there are still so many risks around the world that our country needs to be protected from. to think that our marine corps wouldn't be able to respond to one major contingency. it's outrageous and it really cries for bipartisan leadership on this issue, and particularly leadership from our commander in chief. and to put it in perspective, it's not just -- it's not just an issue of our national security. you would think that would be enough to bring people to the table, but we are talking about jobs across this country. the national association of

manufacturers has estimated it would be nearly a million jobs. george mason university, the same, and to my colleagues, looking around here just at pulling some states in terms of the estimates of job losses, 24,000 for alabama. when we look at a state like missouri, 31,000. when we look at a state, for example, like florida, there are thousands of jobs -- 39,000 for florida. this is an issue that will hit every state in this nation, but most importantly, what i'm concerned about, it is going to hit our military in a way that we break faith with our troops. in fact, one general has said we would have to cut an additional 100,000 troops from our army on top of the reductions we're making right now, approximately 72,000 and 50% would have to come from the

guard and reserve. you think about the important function not only protecting our country, we could not have fought in afghanistan and iraq without our guard and reserve. i'm the proud wife of someone who served in the iraq war, and i can tell you this, that it's not only the function that our guard and reserve play in terms of protecting us overseas, but they also perform a very important homeland function and every governor in this country will be deeply concerned if we're going to diminish our guard and reserve. so this is an issue that cries out for leadership from both sides of the aisle. i look forward to working with my colleagues on this now. it cannot wait till a lame duck session. we cannot put our national security in the balance, and nearly a million jobs at issue, till a lame duck session. this is something we should resolve right now and i appreciate my colleagues have come to the floor to talk about this issue today. we must get this done on behalf of the american people and our men and women in uniform.

i thank you, mr. president, and i yield the floor. the presiding officer: the senator from illinois. mr. durbin: i think senator corker from tennessee was on the floor before me. i don't know if we're going back and forth or how long he expects to speak but i'd yield to hear what his plans are. the presiding officer: the senator from tennessee. mr. corker: i thank the senator from illinois. i'll speak for two or three minutes. mr. durbin: i yield to the senator from tennessee and ask that i follow him. the presiding officer: without objection. mr. corker: i appreciate the comments of my colleagues from arizona and south carolina regarding the sequestration. the reason we are in the sequestration mode is six democrats and six republicans could not figure out a way over a ton-year period to cut $1.2 trillion in spending out of $45 trillion that are going to be spent by the federal government during that period of time. so i do hope there's a way to

resolve that but i'm here to speak about something related but in some ways very different. today we're getting ready to vote on to legislation dealing with flood insurance, dealing with student lending, dealing with highways, and these are all very popular programs. what people in -- who are listening to may be paying attention to what the senate is doing today, what they may not know is that for the third time in a bipartisan way this body is getting ready to spend more money than was deemed by the budget that was ultimately created by the budget control act just last year when the country almost shut down trying to save a mere $900 billion over the next ten years. so a vote today for this piece of legislation is basically a vote to say that the united states senate cannot be

entrusted to carry out the things that it laid out last august, to keep us from spending money that we do not have. and so, mr. president, i know there's going to be some budget point of orders that will be brought forth at some point later today. i just want to say as one senator from tennessee, it continues to be unbelievable to me that this body does not have the courage, does not have the will, does not have the discipline to even live within a very modest budget that was laid out last august. today i'm certain that we are going to pass legislation that spends billions of dollars more than we agreed to by the budget control act and especially the deemed budget that came after that. the deemed budget that was put in place as a result of what we put -- what we passed last

august. so i would say all those who vote for this today are basically saying we do not have the discipline to live within our means, the problems that our nation faces fiscally are only going to get worse, and i think this is a very sad day for our country if that, in fact, is what happens within the next two or three hours on the senate floor. with that, mr. president, i yield the floor. mr. durbin: mr. president? the presiding officer: the senator from illinois. mr. durbin: i thank the senator from tennessee for his comments and i share his concern about our deficit. i was a member of the simpson-bowles commission, voted for the report, bipartisan effort to reduce the deficit by $1.4 trillion over ten years. i think we set in place a description, maybe a guide post for how we can do this and i would agree with him that we need to take care in the money that we spend now which will add

to the deficit, though i have to say my understanding is this transportation bill is paid for. there are revenue sources that are part of this. i know that the student loan continued decrease in interest rates to 3.4% for student loans is paid for. and i believe the changes within the flood insurance program which is part of this package as well, the republican leader spoke to this morning, reforms in that program will move it closer to sustainability and solvency. it is not where it needs to be but it is moving closer. but i want address if i can what has been the topic about the planned cuts in the department of defense. let me say what we all agree on. number one, we never, ever want to shortchange america's security nor shortchange our men and women in uniform. a nephew of mine who served as a doorman right up here in the

gallery recently returned from one year in afghanistan, we were sending packages, worried about michael every day, got home safely. that's happening over and over again across america. i wanted my nephew to have all he needed to come home safely and i think everyone feels the same when it comes to the department of defense. now let's step back and look at this deficit debate and allow my to put it in a little perspective for a moment. the last time we balanced the federal budget was not in the 19th century. it was about 11 years ago. it was a time when william jefferson clinton was president of the united states, and for three years we had a balanced budget under a democratic president. three years, a balanced budget. when we reached a balanced budget, if you stepped back and said, well, what do you have in terms of spending and revenue, they're the same, here's what we found:

revenue and spending both eequaled 19.5% of america's gross domestic product. the sum total of the values of goods and services produced in america every year. it changes. it grows. and the last year we were in balance, taxes equaled 19.5% of our gross domestic product, federal spending equaled 19.5%. and we had a balanced budget. now we're in depend water. we saw the accumulated debt of the united states more than double under president george w. bush, and it continues to grow because of the recession under this president. our annual deficits are over $1 trillion and unsustainable. unsustainable. we borrow 40 cents for every dollar we spend, whether we're buying military equipment or paying for food stamps. we borrow 40 cents. that's unsustainable.

but now that we now there was a time when we were in balance, it is fair to say, well, what's happened to spending since this budget was in balance? if do you it in constant dollars so there's no mung ca can iing - monkeying around with numbers here, here's what happened when we were last in balance in our budget. domestic discretionary spending equals student loans, medical research, transportation, all of the different things that don't fit in the department of defen defense. the spending in those areas since we were last in balance has been flat, no increase, no increase. what about spending for entitlement programs? medicare, medicaid, programs like that, veterans care, what has happened to them since we were last in balance? since we were last in balance, the i ask that the quorum call bi ask that the quorum callbe st

programs has gone up 30%. why? the baby boomers have arrived. 10,000 people a day reach the age of 65. they show up now and say, it's our turn. because of that entitlement spending has gone up. now let's look at the third part of the budget which was addressed by my republican colleagues this morning. defense spending. what has happened to defense spending since the budget was in balance? domestic discretionary flat, entitlements 30%. as of this year's budget, defense spending will have risen 73% -- 73% since the budget was last in balance. so, we created a supercommittee. senator kerry of massachusetts was a member. and we said, find ways to reduce the deficit by $1.2 trillion over ten years. they tried. and i'm sure senator kerry will speak to that effort. at the end of the day, they

couldn't reach a bipartisan agreement. h. on -- a bipartisan agreement on how it would be done. so the law we passed said if you can't reach an agreement, we're going do it automatically. we're going to take $500 billion out of defense and $500 billion out of non-defense spending. that's what this is about. people are coming to the floor and saying, we can't take another $500 billion out of defense spending. i will tell you, i think that is a lot to be taken out in light of what we've already anticipated we're going to reduce spending. i think it will cause some serious problems, but i reject the notion that that $500 billion, if it's taken out of domestic discretionary won't have equally horrible results. so i say to my friends on the other side of the aisle, when you had a chance in the supercommittee to deal with the spending cuts of a lesser amount or to deal with revenue, closing tax loopholes, you walked away from it. now you're complaining that we

may end up cutting defense spending. incidentally, if the sequestration number went through, the additional $500 billion in cuts over the next ten years, it would bring the amount of money we spend on defense to the same percentage of the gross domestic product as it was when the budget was in balance. so, my friends who are speaking for the national defense, i join you. but i also speak for investments in america when it comes to education, innovation, and infrastructure, which will help our economy grow. and sequestration of the domestic side is unacceptable from this senator's point of view as well. we need to get beyond this and talk about an honest answer to reducing the deficit. an honest answer, going back to simpson-bowles, puts everything on the table -- everything. to my friends on the other side of the aisle, it puts revenue on

table. it must. my friends on this side. aisle, it puts entitlement programs on the table, and it must. and it includes spending cuts. that is the only honest way to address this. but to pick it off and say we're going to take the one area of of the budget that has grown in spending by 73% and hold it harmless, ignore it, and then have them say, and we won't touch revenue, leaves two possibilities, if we're going to do anything about the deficit: deeper cuts in programs like student loans, medical research, or cuts in medicare. that's what it comes down to. hard choices, right? that's why i think the bowles-simpson approach by putting everything on the table was the right appropriate i would urge my colleagues on both side of the aisle to take this pain that we're facing on december 31 and turn it into an opportunity to reduce this deficit. i yield the floor. senator mr. president? the presiding officer: the senator from utah. mr. lee: mr. president, i stand to raise a concern that i

have with regard to the conference committee report to accompany h.r. 4348. pursuant to paragraph 9 of rule 28 of the standing rules of the senate, we're supposed to have adequate notice of a report like this before we've the opportunity to vote on it. the provision states that it shall not be in order to vote on the adoption of a report of a committee of conference unless such report has been made available to members and to the general public for at least 48 hours before such vote. now, the current version of the committee report was filed, as i understand it, at 8:07 p.m. last night. it's not even close to the 48 hours required notice. what we have ultimately, mr. president, when we look at this is the fact that we have a highway bill that was sent to conference, but it came back from closed-door negotiations with a student loan bill and also with a flood insurance bill

attached to it. we were neither given the chance to debate nor given the chance to amend these provisions before they came to the floor, and now we're approaching a vote on that. we did not provide our fellow senators or the american people with an adequate opportunity to read the 596-page conference report that's required by our very own rules. this is somewhat recommend any since the of a statement made a few years ago by then-speaker of the house nancy pelosi when speaking to members of her body regarding the passage of the affordable care act, she said, "we have to pass the bill so that you can find out what's in it." this is one of the problems that we have in washington, one of the problems that the american people are becoming increasingly aware of. it's a problem that i think we need to address. time and time again we have a problem in which the senate waits until the day before a

holiday or the day before a scheduled in-state work period before bringing something to the floor for a vote. without following the senate's own rules, rules that were designed to promote and protect the openness and transparency of the legislative process. this is a troubling trend, and it is a trend that we should seek to avoid whenever, wherever possible. thank you, mr. president. mr. paul: mr. president? the presiding officer: the senator from kentucky. mr. paul: currently congress has about a 10% approval rate. one. reasons is we don't even obey our own rules. for goodness sakes, 600-page bill -- and i got it this morning -- not one member of the senate will read this bill before we vote on it. we're going to vote on this in the next 30 minutes. i and senator lee and others will object to this. we'll have a point of order that our own rules say it has to be posted online for 48 hours.

600 pages, no one will read it. no wonder our approval rate something 10%. nobody knows what we're voting on. in fact, stings have been stuck in this -- things have been stuck in this bill last night that have nothing to do with any of these bills and they have been stuck in and we're just discovering it. i passed two senators in the hall going back to their office still trying to get out something that's been written in this bill that affects their states minutes ago. had they not found out about it, nobody would have known about it. three bills that are in question here -- transportation bill, student loan bill. the student loan bill, originally the loans were at 6%, and somehow bringing in money to the treasury. we were using that money to pay for obamacare. now it's at 3%. that money is gone. whereby's the known pay for obamacare? -- where's the money to pay for obamacare? we have a shell game up here. we say woning is going to pay for it. now this is going to pay for it.

money disappears. now they say they're going to pay for it by taking montana oust pensions. raise your hand if you think it is a good tied underfund pensions more. over half of the pensions in this country are technically insolvent. is it a good idea to have less money go into workers' pensions to pay for a student loan program? i have a bill in congress that says we should read the bills before we pass them. it says that we should wait one day for each 20 pages, so we'd be given time to read 600-page bills. but at the very least we ought to adhere to our own rules. our rules say that it should be posted online at least 48 hours. 48 hours is still a challenge to find out everything in here. you know how long the "federal register" is? it is 55,000 pages added annually. it is hundreds of thousands of pages. so when you read this, you have to refer to the "federal

register" that's hundreds of thousands of pages to find out what they've stuck in this bill in the dead of night. this isn't the way we should o the american people want wonder why do i would all of a sudden say, the government is going to shut down if we don't do something in three days in well what were they doing for the previous three months? the other side hasn't produce add budget in three years. that's against the rules. the rules of the senate say you must produce a budget and they didn't do it, for three years. when we presented them with their own budget that we wrote for them, nobody voted for it. zero on the other side of the aisle voted for their own president's budget. how are we going to get to compromise if they're not showing up for work? how are we going to get anything done if they don't obey their own rules? i'm discouraged by this. i will raise a point of order in the next hour that says we have broken the rules of the senate, and i will ask them to vote on it. i fully expect the parliamentarian will rule in our favor. we'll see.

but then the other side will simply close their eyes to the rules. they won't care what the parliamentarian say, and they will just overturn this by saying, we are the majority and we deem it so. we are the majority, and we don't care what's in the bills. we don't care to take the time to read the bills. we are in the majority, and we deem it so. i think this is why the american people are unhappy with what's going on in this body. i object strenuously to it. i will vote against it, and i will raise a point of order that says we should read the bills before we pass them. thank you, mr. president. mr. sessions: mr. president? the presiding officer: the senator from alabama. mr. sessions: i thank senator paul for raising these issues. we are mismanaging the american people's money. it's good to see senator lee, who just spoke, and senator paul, new members to the united states senate, who have been out talking to the american people, who make commitment commitmentsy are going to try to improve the process here.

i celebrate their activity, vigor and determination and a lot of others feel the same way in our body. mr. president, we'll be moving a cobbled-together bill here shortly. an attempt will be done to accomplish that, and i expect budget points of order, another point of order to be raised. i just wanted to share some thoughts about how it is we do business and some of the efforts that aren't legitimate as we go about our business and are dangerous to the health financially of america. let's take what we call "the lust fund." it's anode name the -- it's an odd nay. the true name of it is the leaking underground storage tank fund. people that have storage tanks have to pay fees, it goes into a

fund and you had the idea of that -- the idea of that fund is to be available when cleanups need to be done and the company or other companies have gone bankrupt and there is owe no money. this fund will pay to clean up the waste. makes sense, maybe. it's been operating for quite a number of years. it's run up a surplus. now, that surplus is in the luft trust fund, the leaking underground storage tank fund -- and where does it go? what do you do with that money? the treasury of the united states is spending more money every year than it takes in. this year we will spend approximately $3.7 trillion, we take in about $2.2 trillion, and have 1,300 billion dollar deficit. that's how much we're spending. taking in about $2.4 trillion, having about a $1.3 trillion

deficit this year, the fourth consecutive year we've had over 1,000 billion-dollar deficits. we'll have a big one next year. we're systemically overspending. let's look at this fund and it has some real money in it, a number of billions of dollars and what happens to it? well, when the government spends more money than it takes in, it takes the money from the luft fund. well, how does it get it? it borrows it. so there's actually a debt instrument from the united states treasury to the trustees of the holders, the managers of the luft trust fund and they've loaned the money, they don't need it today, they loan it to the government so they can spend it. and it's been borrowed and has been spent and the assets in the luft fund are nothing more than debt instruments from the united states treasury.

but on the books it appears that this lust fund has assets. i guess it has u.s. treasury notes. so the people looking around to spend money and try to meet the demands of our constituents to build highways in this case decided they can take that money. and you know something, it does not score as a -- an expenditure in that fashion. it's an odd way this is done. it's not properly -- it's seen as found money that can go over and be spent. but where does the money come from? the money is not in the fund, remember. only the fund holds treasury bills. the highway trust fund doesn't want treasury bills, it wants money that can be spent. and so what happens is the united states treasury, which has been borrowing money from another government agency and

giving a debt instrument in return, has to come up with the money now. if it's going to be spent, going to be taken out of the trust fund, where do they get the money? they convert an internal debt to an external debt. the only thing they will do is borrow more money. so it will be this many billion dollars more than $1.2 trillion, $1.3 trillion we have. and the debt is converted to a public debt and somebody in china or somebody in japan or somebody in new york will loan money to the government, and they'll use that money to pay the highway trust fund with. you see how circular that is? it allows the money to be double counted. it is a actually what happened with the president's -- president obama's health care bill. $400 billion was funded this

way. social security still has a surplus, although it's been drawn down, it still has a surplus in its account. medicare does. and so the medicare trustees raised medicare taxes, they cut benefits and they saved $400 billion. and under that, which would be money of the medicare, and the trustees, it's their money. what happens with it? under the conventions of accounting, the money was available to be spent by the u.s. treasury. and the u.s. treasury then would spend it on the new health care bill. and the congressional budget office director, mr. elmendorf, wrote me a letter the night before the bill passed, christmas eve, and he said this is double counting the money. you can't simultaneously count

it as making medicare better and providing new money to fund the health care bill with. $400 billion on the night before the vote, he announces this is double counting. if a private business were to do it, they would be in big trouble, i suggest. they might be sued for fraud. they would be sued for fraud. so the money was done in that fashion, and the way it happened was mr. elmendorf said it's double counting the money, you can't simultaneously benefit medicare and fund a new health care program, although the conventions of accounting might suggest otherwise. and so the real smart financeiers, what did they do? they figured out how to use the conventions of accounting in a way that obscured the fact that

they didn't have the $400 billion. and it was borrowed money, in truth. mr. president, i see my colleagues on the floor and would yield the floor. mr. inhofe: mr. president? the presiding officer: the senator from oklahoma. mr. inhofe: i just have a couple of comments to make for clarification purposes. i first of all i don't think anyone is going to question my conservative credentials over the years that i've been here, and i've been -- i've been really offended by a lot of the things that have happened, structurally in this institution, over in the house, but insofar as this bill is concerned, let me kind of clarify a couple of things. it sounds real good when you stand up here and say we've only had a matter of minutes to look at something that's 500 pages. we've had this bill for a long time, for several days. we've had it, we've gone over everything. on the bill we sent from the senate to the house, it's essentially the same thing.

i don't agree when they added the two provisions on student loan and flood insurance, i didn't agree with that. everyone knows those issues. i didn't think they should be in here. nevertheless we dent have any control in this over that. as far as the provisions of the bill are concerned, these provisions we have seen and everyone who has spoken against it has been there when we talked about the great reforms and i've commented several times that i thought one of the problems was that we did too good of a job because we had too many reforms. and -- and when it got over to the house where they're inclined to have more reforms in there, they had to start from the base where we had done a good job descreamlining, enhancements, all these things are in it and all can say from a conservative perspective, we've seen this bill, we've lived with this bill, not just ours, not -- not just hours, not days, but actually for weeks.

the basic provisions of the bill. but what we have to realize is that there is an alternative to what we're doing here today. and that alternative and the only alternative, only alternative is to go back to extensions. and when you go to extensions, a couple of things happen. number one, you don't have any of the reforms that we have. number two, you throw away about 30% of the money. a senator: mr. president? mr. president? the presiding officer: the majority leader. mr. reid: would my friend yield for a question? through the chair to my friend, the ranking member of this committee, it's true, is it not, that basically the same bill that we are going to vote on today passed this institution in march? mr. inhofe: it is true, i say through the chair, it passed this institution with 74 votes, as i recall. mr. reid: so, again, people have had since march to read this bill, a little bit, don't you think? mr. inhofe: i answer in the affirmative. but before, --

mrs. boxer: would my friend yield further? i want to correct the record. there are a few changes, we speeded up project delivery, as my friend knows, we gave a little more flexibility to states in terms of the t.e. program. a few things are changed but my friends are right. primarily, this is a similar bill, it takes the money and we say we're going to spend the same thing plus inflation, and it's true. these bills have been out here for a long time. actually passed our committee, senator inhofe, in november of last year. mr. inhofe: i respond yes, that is correct. that is accurate. i think that's very important, too. because we've been talking about this bill for a long period of time. we actually started trying to get a highway reauthorization bill way back in 2009 when the old bill from 2005 expired. but these provisions, the problem is -- and i want to get back on where i was, there is an alternative to this bill. if you defeat this bill, we go

back to extensions. if you go back to extensions, first of all, you're losing about 30% of the money off the top. everybody knows that. and secondly, you don't get these reforms. if people are concerned out there, conservatives, that they're not getting -- that they're going to defeat this and go back to extensions, they're not going to have the reform with the enhancements. the law requires right now that 2% or 10%, depending on how you want to put it, 2% from total funding or 10% -- 10% of total funding or 2% of surface transportation. that has to be spent on transportation enhancements. my good friend, the senator, the chairman of the committee that had this, senator boxer, she and i disagree on enhancements. she lieks them, i don't. i want money spent on concrete, roads, and bridges. this is what we should be doing. that's a disagreement we had but we should had a compromise where

she can have and anyone can have what they want. it's an oversimplification but it means this money is going to be put in something that can be enhancements but in my state of oklahoma it's not going to be enhancements, it's paying for some of the unfunded mandates, paying for things we have to do in terms of the environment and things that are required. so we have solved that problem. if we don't pass this bill we go right back and it's going to have to go to enhancements. streamlining, all the streamlining in this in terms, environmental streamlining, you talk to any of the road contractors out there and they'll tell you about the waste of money and the number of miles of roads that can't -- they can't do because some of these requirements, these environmental requirements. we have streamlined those requirements. now, if we don't pass this bill we're going to go back to extensions and that same thing, we're going to lose all those opportunities. so not only will it cost more, you're not going to get the streamlining.

and i would say this, i'm very proud of a group that's always supported me, the american conservative union. is there anyone around here who doesn't think the american conservative union is conservative? i have made a part of the record when i made a speech yesterday and i put an editorial by the chairman of the american conservative union, an op-ed piece, let me read two short paragraphs frafs. mr. president, one paragraph says, i'm quoting now, in the op-ed piece from the american conservative union. article one, section 8 of the constitution specifically lists interstate road building as one of the delineated powers and responsibilities vested in the federal government in the federalist papers number 42 james madison makes an early case for the federal government's role in maintaining a healthy infrastructure by stating -- quote -- "nothing which tends to facilitate the intercourse between states can be deemed unworthy of public care." and he goes on to say -- this

is the american conservative union -- perhaps most importantly, those of house believe in the constitutional conservativism understand that unlike all of the things the federal governmentways our money on -- wastes our money on, transportation spending is at the core of what constitutes legitimate spending. that's the american conservative union. i just want people to understand that this is -- voting for this is the conservative approach. you get more from the money that's being spent and it has all the streamlining in it and this is our constitutional responsibility. this is what we're supposed to do. and there are only two ways of doing it. one way is to pass this bill and the other is to operate on extensions and i just think it's very important for people to understand that. request with -- with that, i yield the floor. i suggest the absence of a quorum. the presiding officer: the clerk will call the roll. quorum call:

quorum call:

the presiding officer: the majority leader. mr. reid: i ask unanimous consent the call of the quorum be at the pointed. the presiding officer: without objection. mr. reid: i have one unanimous consent request for a committee to meet during today's session of the both senator mcconnell and i have approved this. i ask consent that the requests be agreed to and that this request be printed in the record. the presiding officer: without objection. mr. reid: mr. president, i now ask unanimous consent that notwithstanding lack of receipt of the papers with respect to the conference report to accompany h.r. 4348, at 12:55 p.m. today the senate proceed to a series of stacked votes, the time until then be equally divided between the two leaders or their designees and

any points of order in order to the conference be budget points of order, that points of order relative to rule 28 or rule 28, paragraph 9, availability. if a rule 28 scope of conference point of order, rule 28 availability point of order is made against the conference report, an applicable motion to waive is made, the senate proceed to vote on the motion to waive in the order they were raised. if the motions to waive are successful, the senate proceed to vote on the adoption of the conference report. the adoption of the conference report be subject to a 60-affirmative vote threshold, there be two minutes equally divided prior to each vote, all after the first vote be ten minutes votes. and, mr. president, i ask that consent in spite of the fact that votes might not come right after each other. further, that if the conference report is adopted, the title

amendment be agreed to, no motions to recommit be be in order to the conference report. the presiding officer: is there objection? without objection, so ordered. mr. reid: i asmr. reid: the timt having arrived, i suggest the absence of a quorum. the presiding officer: the clerk will call the roll. quorum call:

mr. mcconnell: mr. president? the presiding officer: the republican leader. mr. mcconnell: i ask consent that further proceedings under the quorum call be dispensed with. the presiding officer: without objection. mr. mcconnell: mr. president, on behalf of senator paul, i raise a point of order that the conference report on h.r. 4348

has not been publicly available for 48 hours, as required by rule 28, paragraph 9. mrthe presiding officer: the majority leader. mr. reid: mr. president, i move to waive the provisions nor mcconnell just noted. that's rule 9 -- paragraph 9 of rule 28. the presiding officer: the question is on a motion to way. -- a motion to waive. mr. reid: i ask for the yeas and nays. the presiding officer: is there a sufficient second? there appears to be a sufficient second. there is a sufficient second. the clerk will call the roll. vote:

vote:

vote:

the presiding officer: on this vote the yeas are 72, the nays are 20. three-fifths of the senators duly chosen and sworn having

voted in the affirmative, the motion is agreed to. and the point of order fails. the nays are actually in the number of 22. mr. reid: mr. president, could we have order. the presiding officer: may we have order, please. mr. reid: senator coats wishes to speak. please, everyone, be quiet. the presiding officer: the senator from indiana. mr. coats: i would like to raise the point of order that section 1538 of the conference report to accompany h.r. 4348 violates rule 28 as it is a matter not committed by either house. mr. president, this is not a partisan issue. the senator from illinois, senator durbin, the senator from ohio, senator brown, the senator from illinois, senator kirk and i reached an agreement on how to deal with this issue. and yet during this conference work that was proceeding in the dark of the night --. the presiding officer: the point of order is not debatable. mr. coats: i'm not debating it.

i'm just explaining it. mr. reid: i wish to -- i move to waive all scope of conference points of order under rule 28. the presiding officer: are there fur points of order? mr. coats: i would ask for a recorded vote on that. the presiding officer: if there are no further points of order under rule 38 -- 28, the yeas and nays have been asked for on the motion to waive. is there a sufficient second? there appears to be a sufficient second. there is a sufficient second. there are now two minutes of debate on the waiver.

a senator: mr. president? the presiding officer: the senator from indiana. mr. coats: mr. president, this gives me a chance -- i jumped the gun a little bit. this gives me a chance to explain it twice. this is a bipartisan agreement was reached on this, when it went over to the house, i won't name names but somebody dropped something in the middle of the night to change this whole process. the issue here is not just so-called asian carp. the issue is if this language is allowed to proceed, we will be authorizing over $100 billion of potential spending to address this without any review by the congress. all we ask for in our agreement was a simple opportunity to review the study by the corps of engineers so that he we -- that

we could make a decision, which includes over $100 billion in authorized spending. that's why i urge my colleagues to oppose any effort to waive this rule. the presiding officer: the majority leader. mr. reid: mr. president --. the presiding officer: may we have order. mr. reid: mr. president, i know everyone is anxious to finish and i am, too. but, mr. president, this is a massive bill. it is so good for our country. student loans, flood insurance, and 2.8 million jobs. there are a lot of disappointments. i have a few, i'd be happy to share with someone at the right time, in this bill. but, mr. president, we cannot -- we must waive this. we cannot have this very important bill, one of the great accomplishments of this congress. please, everyone, vote to waive this. the presiding officer: the yeas and nays were previously ordered. the clerk will call the roll.

vote:

vote:

the presiding officer: may we have order. on this vote, the yeas are 66, the nays are 28. three-fifths of the senators duly chosen and having been sworn, having voted in the affirmative, the motion is agreed to and the point of order fails. -- falls. mr. corker: mr. president? the presiding officer: the senator from tennessee. mr. corker: the pending measure, the conference report to accompany h.r. 4348, would exceed the aggregate level of budget authority and outlays for

the fiscal year 2012 -- the presiding officer: the senate will be in order, please. mr. corker: as laid out in the most recent budget resolution deemed by the -- a senator: the national is still not the senate will come to order. the presiding officer: the senate will come to order. the majority leader. mr. reid: i cannot hear the senator from tennessee. i can't hear him. the presiding officer: the senator from tenton. mr. corker: the most important part, sir. therefore, i raise a point of order under section 311 (a) 2 of the congressional budget act of 1974. mr. reid: mr. president? the presiding officer: the majority leader. mr. reid: pursuant to section 904 of the budget act, the waiver provision applicable to budget resolutions section 4-g13 of the statutory paygo act of 2010, i move to waive all applicable exises of those being as, for the purposes of the

pending conference report and i ask for the yeas and nays. however, i ask consent that the letter from c.b.o. be made part of this record which indicates that not only is everything paid for in this bill, it reduces the debt. the presiding officer: without objection. mr. reid: and i ask for the yeas and nays. mr. corker: mr. president -- wait a minute. mr. reid: i am sorry. the presiding officer: is there a sufficient second? there appears to be a sufficient -- mr. corker: if i could make sure the national is in order before i speak. the presiding officer: is there a sufficient second? there appears to be a sufficient second. there is a sufficient second. the yeas and nays are ordered. mr. corker: if i could have everybody's attention, mr. president, according to c.b.o., this is paid for the old way, where you spend all the money in a year or two and then it's paid for over ten. this body came together last august in a bipartisan way to put in place the budget control

act, and this bill violates the deemed budget by $2.5 billion. this will be the third time that we violate the budget control act-deemed budget. and for all those people who are meeting in the evenings, meeting in groups trying to solve our nation's fiscal irvs, a vote to waive this motion says that we don't have the discipline, the courage, nor will to do what we told the american people we would do, to try too get our fiscal house in order. i urge you to vote against this motion to waive right now. thank you, mr. president. mr. reid: mr. president? mr. president? the presiding officer: the majority leader. mrs. boxer: the national is not in order. mr. reid: mr. president, the congressional budget office is a nonpart an body that determines what spending is fo for the congress. and they've determined that this bill is paid for and it reduces the debt.

the presiding officer: the question is on the motion to waive. the yeas and nays were ordered. the clerk will call the roll. vote:

vote:

the presiding officer: on this vote, the yeas are 63, the nays are 30, one senator responded present. 3/5 of the senators duly chosen and sworn having voted in the affirmative, the motion is agreed to and the point of order falls. under the previous order, the question occurs on the conference report to accompany h.r. 4348. without objection, all time is yielded back. is there a sufficient second? there appears to be. there is a sufficient second. the clerk will call the roll. vote:

vote:

the presiding officer: on this vote, the yeas are 74, the nays are 19, one senator voted present. under the previous order requiring 60 votes for the adoption of this conference report, the conference report is agreed to. mrs. boxer: mr. president? the presiding officer: the senator from california. mrs. boxer: do i need to move to reconsider or lay on the table or we are done? move to reconsider and lay on the table. the presiding officer: without objection. mrs. boxer: well, it has been a very long and winding road to get to this place. and i am overwhelmed with the amazing vote that we just had, the margin of success, the fact that this is a product that is not only bipartisan but bicameral. i understand the house vote was

equally lopsided in favor. and i think it sends a tremendous signal to the people of america, and that is that we can work together. do not give up hope. when it comes to the well-being of our people, we must get together. and i know that the president must be smiling broadly because he has stated over and over again how important it has been for us to pass a highway bill, to pass a student loan reduction in interest rate bill, in order to help our people. i have said many times that what kept me going and so many others, and i'm going to name the various chairmen that i worked with here and over on the house side and the staffs, what really kept us all going is the fact that we know how the construction sector has been sit hard in this recession.

and the housing prices started this recession. it has not gotten better. it is slowly coming around, but new construction is going to take a while until all the inventories are back in an appropriate place. and what's going to help us, we could fill ten super bowl stadiums with unemployed construction workers, mr. president. we're looking at well over a million construction workers who are unemployed. well, this was the answer. the transportation sector is hurting, the construction sector is hurting, and today we have sent a message, a powerful message that for two years and three months we have funded a good bill that is going to employ up to three million workers and help thousands and thousands of businesses. and it's all in the private

sector, and things that need to be done. we know we have 70,000 bridges that are deficient, mr. president. we know we have 50% of our roads that are deficient. and we know that we have transit systems that need to make capital improvements. we know we have bike paths that need fixing and pedestrian walkways that need fixing and all of that has been resolved. now, are there things in this package that i don't like? absolutely. are there things in this package that my republican counterparts don't like? absolutely. we had to give, we had to take, we struggled and i want to say, i'm going to read into the record now the names of these staffers. now, this is an unbelievable list. so i'm going to do it quickly, and i'm going to say that to these staffers from the various committees, that they knew how important their work was.

they knew if we didn't succeed, there would be no more money in the highway trust fund, and all of the repairs on our roads would stop and the repairs on our bridges because everyone out there, since dwight eisenhower was president, depends on the federal share. can't have a strong economy without a strong infrastructure. so here are the names, i am a he not reading democrats and then republicans. i'm reading the department list of staffers. bettina ruth david james o'keefe, andrew doorman, murphy, kyl miller, jason al written, tom lynch, mark hibner, alex vangel, i also want to thank the leadership staff, when things were looking glum, there they were. bill do youster, the staff

directors of the key committeette moos who worked on this, remember these -- this is four committee process. it was e.p.w., it was banking, it was commerce, it was finance. so i thank russ full van,al len derneski and their amazing team. that includes ryan abrahams with the finance committee, ian jeffries david paneli, and james reed with the commerce committee, homar carlisle with the banking committee, and i also want to thank senate legislative counsel particularly rochelle celebrese, who i drove crazy yesterday telling them please produce the paper. well, this staff that i read, they love their work so, i thought they'd never end it. i'm telling you, i had to beg them, please finish because there will always be something more you could do. you can always be something

better. you can always put a comma in a different place. they wanted to make this as perfect as they could. and there was a time when we just had to say, okay, we're done. and they got it done. i am very moved at their dedication. mr. president, i know that my staff at e.p.w. for three days, the top staff that i read here, if they got four or five hours of sleep, they got a lot of they were running on empty. and i tell them that their names will forever be in this record, and people that they don't know will flourish because of their work o. when we start hiring people do this infrastructure work. i want to thank my dear colleagues, jay rockefeller, max

baucus, tim johnson. no way could i have done it without them. and i also want to pay tribute to mary landrieu, who is on the floor today. mary landrieu, senator landrieu and her state, they've gone through so many traumas, so ma many, with hurricanes and all the attendant problems, and the b.p. oil spill, which put such terrible damage -- which meant so much terrible damage to her state and the other gulf states, environmental damage, commercial damage, broke hearts, broke spirits. but let me tell you, you never break mary landrieu's spirit. she teamed up with her colleague here, senator vitter, and they wrote the restore act. and then she went to all the other colleagues in the gulf coast and said, you've got to

help me with this and they put together a great package. and what it really means without going into the details -- she will agree into the details -- is when the court decision comes down and the funds come to the federal government for all the violations of law that took place with the b.p. spill, 80% of those funds will be directed to the very people that got hurt, and senator landrieu, it is an honor to work with you, it is a privilege. and you have been a model for a senator who never, ever, ever stops fighting. and i am so grateful that i was able to step up to the plate and help you. so i will add some more names of colleagues, because i just don't have time at this point. i know others want to speak. but this is a great -- a great moment. the bill we passed -- the bill we passed is a good bill. it's going to speed up project

delivery without waiving any environmental laws, so we keep the protections in, we give a little more flexibility to the states on the alternative transportation routes, but, believe me, we also add a new piece that gives more power to the local people to decide on these projects. i'm just so pleased, and i will keep the -- i will add a few more statements to the record later today. but we have done this. we're going to mark this moment, and after we get our breath back and after we get our energy back, we're going to look at a long-term solution to the problem of the highway trust fund. we know the gas tax receipts are going down, and we have to solve the problem. if it wasn't for senator baucus and his staff, we never would be at this point because we didn't have the funding and they had to come up with it. so i thank them and the

republicans on the committee, and with that, mr. president, i yield the floor, thanking one and all for this tremendous vote today. ms. landrieu: mr. president? the presiding officer: the senator from louisiana. ms. landrieu: thank you, mr. president. before the senator from california leaves the floor, for much-needed rest and relaxation and celebration with her extraordinary staff, let me be one of the first to thank her, to join my colleagues who have thanked her for her leadership. this transportation bill would not be a reality for the nation, not for california, not for texas, not for new york, not for louisiana, if it weren't for the leadership of the chairperson of this committee. senator rockefeller was there to push, senator baucus was there to push, senator johnson was there to push, but the leader of this victory was senator barbara

boxer, and her colleague senator inhofe stood bravely, mr. president, against winds of opposition, ideology, without common sense, ideology without regards to the needs of the nation. and senator inhofe, a republican, stood against those winds and with the senator from california to produce a jobs bill for the nation. and i hope people really appreciate the extraordinary accomplishment this is in the context of the political quagmire that we find ourselves in, just a few months before a very significant national election, with both sides hugging the opposite wall, for these two to come forward today and meet in the middle of this chamber and to produce a bill with this kind of vote, people did not think it was possible.

up until just a few weeks ago, there was still the majority around here saying it will never happen. but i know something about barbara boxer as well, and she got here as a fighter. her name "boxer" says it all. and it's the way she fought her way to the senate and continues to fight, not just for the people of california but for the people of the nation. so i knew when i went to her two years ago -- now almost a little over two years ago when the deepwater horizon platform blew up in the gulf -- i knew one of the first people that i could go to to ask for help, to ask for support, to ask for her ideas and her advice about what to do would be senator boxer. she is a strong environmentalists. she has a heart for our oceans, and she understood the challenge

of the louisiana eroding coastline, more so than many members in this body. and i will be forever grateful to the fact that she and her staff sat with me and other colleagues and crafted the restore act, which is an historical piece of legislation. it has no precedent. -- it has no precedent here in congress. it will, for the first time, set aside such a significant amount of money from a penalty that has yet to be determined by a polluter that has been determined -- b.p. -- that under the law, the valu now has to pae federal government $1,000 for every barrel of oil that was spilled or gushed out of the

explosion for months on end. they have to pay $1,000 for every barrel of oil that was spilled, and the estimates are, mr. president, that, unfortunately, for our coast, for our people, for our fishermen, for our shrimpers, for our charter boat captains and for other pelicans and fish and oystermen, unfortunately for us it was 5 million barrels of oil that was spilled between august and july until the well was capped. it's the largest pollution event in the history of the nation. it will be the largest fine. i have every confidence that the people of the gulf coast and the nation will find justice in the court. i hope this is -- this fine is as high as it can possibly be, based on the damage that has been done from texas to florida off the coast of louisiana. and so when i brought this to

senator boxer, she understood that we had to find a way of justice for the gulf, and i crafted the restore act with my colleague dick shelby, and for months we negotiated about how to craft it, what to say, how to specifically direct the funding, and had the benefit of having the support of the white house, the support of every commission and every individual appointed by the president supportive of this idea. so i want to first thank the b.p. presidential commission that was one of the first to step up and support this concept of an 80% set-aside and redirect to the gulf. i want to particularly thank secretary ray maybus, former governor of mississippi, knows

the gulf coast well, most certainly understands louisiana's coast as a neighbor for so long. he stepped up and said, yes, this is the right thing to do. and we had hundreds and really thousands and thousands of individuals -- hundreds of organizations that started to come forward and let me just name a few. the environmental defense fund was absolutely instrumental. the national audubon society, the national wildlife federation, the nature conservancy, ocean conservancy, ox fam america and greater new orleans rin inc. were some of te first to step up. ducks unlimited, america's wetlands foundation, restore or retreat -- a very vibrant local and dynamic organization in

south larouche parish. the chamber of southwest louisiana, pat ton rouge area foundation, and women of the storm, representing thousands of women -- not just throughout the gulf coast, mr. president, but as well as as well from your state as well as every state in the union, women that stepped up and said, this kind of accident has to stop; this kind of explosion should never happen again; and, most importantly, they said the people that were hurt the most, the area that was damaged the worst should be compensated by this fine. this money should not come to the general fund of the united states to be spent everywhere else in the nation, for a variety of unrelated purposes. the restore act says, no, the right way for this money to be allocated is to the area where the accident occurred, where the injury occurred, and that is

exactly what restore does; no more and no less. there's one other person that deserves particular thanks and a shout out, and that is the senator from rhode island, sheldon whitehouse. when senator shelby and i finished crafting this bill, which was introduced by two colleagues, a very similar bill on the house side, representative steve is a lease, and cede brick richmond, and representative bonner from alabama, we were having a great deal of difficulty moving a bill through a committee that only had two gulf coast members and senator boxer. the other members were sympathetic, not that enthusiastic, and i can most certainly understand why. as you know, this is going to be

a tremendous amount of money. it's going to direct these funds to only five states. they were sympathetic, but what was in it for everyone else? sheldon whit whitehouse and i pr heads together and came -- it was his idea, the bill itself -- and thought maybe we could, as a part of restore, as an integral part of restore, say that perhaps the oceans deserved justice as well. because water knows no boundaries. what happened in the gulf could have -- could have impacts in the atlantic, up the atlantic seaboard, out to the pacific. who knows? and that is the problem. we don't have, mr. president, enough scientific research going on in this nation about our oceans, which is 70% of our planet, which we in louisiana

derive great pleasure, joy and income from our oceans, mr. our oil and gas exploration that is usually safe on any normal day. this was not a normal day in the gulf when this -- or not a normal operation when this horizon rig blew up. we get our fish, our oysters, our seafood industry, our restaurant industry, our hotels, our ecotourism. i could go on and on. we make our living from the ocean. so senator whitehouse and i thought and i think most reasonable people agreed that the oceans really did deserve something out of it, so at no cost to the five states, we put in a provision of a portion, a small portion, a half a percent, a half of the interest earnings that would be generated. interest earnings, not the fund itself. not taking money away from the

gulf coast as some have claimed, but appropriately saying interest earnings that would create a trust fund for the oceans so that every state could use it for research along their coast. but that was just a bridge too far for the republican leaders in the house who want nothing to do or think we can learn nothing from, want no partnerships, no research whatsoever, i guess, to go on in the oceans, and so as that amendment became a part of the committee process over here, we had that bill. that amendment was connected to restore at the committee level. it was part of restore. it was moved to the floor. it enabled us to build a broader coalition, which is the way legislation is built. it's not one person's idea.

it's not one person's work. the best of the bills and legislation that we pass is about teams, it's about generosity and sharing and understanding. a little give, a little take there. it's a shame that there are some people that are on the other side of this capitol that don't seem to know that that's the basic operations of a democracy. i'm not sure what books they read in school, but they weren't the ones we read at our ursaline academy taught by the nuns. sheldon whitehouse read the same books, so we put this bill together. i couldn't be happier. could i not only not go home and say we did this good thing for the gulf of mexico and everyone came together and helped us in our time of need, but i could also look at our great friends from other parts of the country and say there is a portion in

here for the oceans. so that's how the bill came to the floor, and one of my proudest days of my 16 years here in the senate was when this senate voted under the leadership of senator boxer and myself and senator shelby, voted for this bill, the restore act, with 76 votes. i don't think the transportation bill itself just got 76 votes. just to show you how difficult it is to get 76 votes. other than just, you know, immaterial items, it's hard to get 76 votes for apple pie and mother's day greetings. but we got 76 votes, and i was so proud. not only was it the right thing to do, a great help to the region that i help to represent, but also i thought very fair

with the inclusion also of the land and water that was not part of restore but an amendment that was put on to help share this -- these resources, this effort with other parts of the country. the good news is we passed that bill and paid for it in full over here with a pay-for that was also agreed to by 76 senators, but when the bill went over to the house, one of the first and serious detrimental things that was done was that the oceans endowment trust fund was stripped out. i want those that stripped it out to know this -- we will be back, and we are going to lead a coalition of democrats and republicans in the senate that are going to send a strong message to house republicans that the oceans do deserve our time, our attention and our love and our support and our money, and you can't just do this on a

wish and a prayer. we have wildlife and fish and migratory birds that depend on healthy oceans. the people of our country and the world depend on it, and this will not be the last time that they see the national oceans endowment. and i'm going to be proud to have my name right next to sheldon whitehouse and we'll go to battle again. but around here, you just can't win everything every day, and so they cut it out. we will put it back in and it will be bigger and stronger than it was when they took it out. the other thing that the house republicans did, which i have thought -- i have no understanding of why, is that they -- to pay for this restore act, the student loans, the transportation bill and the flood insurance bill took $700 million away from

louisiana's medicaid budget. i will have more to say about the details of that later because i want to stay focused on restore, but i want to put into the record what our commissioner of administration said who was, of course -- who, of course, works for republican governor bobby jindal and the republican secretary of health and hospitals bruce greenstein said the loss of more than $400 million in fiscal year 2013 -- and it was another $250 million, so it was $650 million in 2014. they said the $400 million in so-called cuts -- to cuts in fmap money already built into the state's fiscal 2013 budget passed by the legislature and signed into law by governor bobby jindal would altogether lead to a loss in medicaid dollars that will require

$1.1 billion in cuts. i'm going to put this into the record. so the house republicans that came up with this idea insisted on this offset when there were others that could have been offered much more fair, much less impactful, much less hurtful. there were some republican members that absolutely insisted that this offset be included, and so the governor, republican governor bobby jindal, the republican legislature and the republican delegation in the house will have to find a way forward. i'm not sure what that way is going to be, but when the bill left the senate, that was not even discussed under any circumstance whatsoever. but the restore act, even this terrible action that was taken on the house side, cannot diminish the really extraordinary victory of the restore act.

and, mr. president, bills like this that basically will distribute anywhere from $5 billion to $20 billion to coastal restoration efforts, they take years, decades to pass. we did this in two years, working together, staying focused, building a support structure nationwide from the business community to the environmental community. the chamber of commerce stepped up. american petroleum institute did their part as well. many of the oil and gas companies stepped up as well. and with the coalition of environmentalists, business organizations, wildlife enthusiasts, we were able to get this significant bill passed. it's going to be a tremendous down payment for the challenge of the gulf coast. and let me for the record just put again, there were 86,985

square miles of water closed to fishing. approximately 36% of federal waters in the gulf were closed to fishing for months, causing a loss to the industry of $2.5 billion. 600 miles of gulf coastline were oil. half of those miles were in louisiana. and some oil is still lingering. in fact, the scientists that have been studying the baseline said that the erosion of the marsh that was oiled was eroding at twice the speed as normal and that normal erosion is pretty breathtaking in terms of its rate. we have lost basically the size of the state of rhode island in the last 50 years, and if our delegation is not successful in continuing to have victories like this, it is conceivable that with the climate change that is happening, the rising of the tides and the frequency of these great storms, that one day

if we're not successful in preserving these wetlands -- which are wetlands of all of america, that drain 40% of our nation, that supply 40% of the fisheries to everybody, 80% of the oil and gas to everyone, that new orleans will be existing as a city with a 30-foot concrete levee around it and everything else washed away. our culture, our hope, our way of life. and i've said this a thousand times. we are not sunbathing here in south louisiana. we are not vacationing in south louisiana. we have fun, we have weekends, we fish, we hunt, but we're not vacationing for weeks and weeks in south louisiana, lying on the beach, getting a tan. there are no beaches to lie on. we only have two. grand isle is seven miles long and holly beach which got washed

away in rita and still has not been rebuilt. and the corps of engineers continues to tell me there is nothing they can do for the last inhabited island off the coast of louisiana. well, there's a lot they can do, and we'll see to that in another bill. but we want these wetlands preserved for our children, for our grandchildren, for the economic vitality of the nation. this is the mouth of the greatest river system in north america, and we intend to save what we can. we will never get everything back. we have lost 1,900 square miles since 1930. we lose 25 square miles of wetlands each year, and we lose a football field every 30 minutes. two million people live in coastal louisiana. about a half a million in mississippi. about a million in alabama. probably about four million in texas. we cannot just get up and move. there is no place really to go.

we don't want to live in arkansas and missouri. we want to live on the gulf coast, and we have been there since before this nation was a nation, and we are not leaving. we are tired of retreating. we know this can be done. we have been to the netherlands. we have been to places around the world. wetlands have been saved. levees built that don't break. and it's cost-effective in the long run. in the short run, it costs investments. in the long run, it creates wealth for everyone. three trillion contributed to the national economy by the gulf coast every year. 17% of the national g.d.p. comes from the gulf coast every year. 50% of all the oil and gas that fuels this nation comes from the gulf coast, and 80% comes from

offshore. and every year, despite how much we do, we get zero back from offshore oil and gas drilling off of our shore, while the interior states have received 50% since 1923. but not texas, not louisiana, not mississippi and not alabama. we just drill, drill, drill, send oil everywhere, keep lights on everywhere, and the planes just run through -- pipelines just run through our state. we're happy to have the industry we'd like to share our revenues with the federal government. but we send to the federal government about $6 billion a year and have for decades. so when people say aren't you -- don't you ever get embarrassed by asking for so much money? no. i could not possibly ask for as much money from washington as we've already sent here. so i'm going to continue to ask for funding for our state because we send off of our

coast -- and we're happy to do it, but we believe in fair partnerships and mutual respect. until we get that, i'm not going to stop advocating for our state. so restore is a first step. it's the right step. it's the fair step, and justice for the gulf for right now. we hope -- and this isn't taxpayer money. that's another thing. this is not taxpayer money. no taxpayers are paying this. b.p. is going to pay this. but we're going to come back next year and talk about the sharing of the tax revenues that the oil companies -- not individuals, the oil companies -- pay to the federal government every year for every barrel of oil, every cubic foot of gas that they take out of the gulf. and that sharing should be done not just here in america, it should be done off the coast of africa, off the coast of south africa, off the coast of brazil, off the coast of ghana. so that the people that live along the coast can be respected, since that's where

the drilling and the exploration is taking place. just like people in north dakota and utah and wyoming share their revenues with the federal government, we intend to have a more robust revenue sharing effort in the future. but until the day that that happens, and i am confident as sure as i'm standing here that it will, this restore money will go as a significant down payment to help jump-start coastal efforts. and we're not going it like every man or woman for himself. it's not a grab bag for governors. senator shelby and i carefully crafted this so the money will be spent wisely, well, and efficiently, in coordination with the federal and state government. now, is it going to be perfect? no. i'm sure we're going to have some stumbling blocks. but this is unprecedented in -- it's unprecedented in its nature. this kind of public works effort has really never been undertaken in this great way. so the scientists, hopefully,

will lead us, the engineers and designers will design what we need, and we can continue giving our best effort and hope to save a great place on this earth. and that is the great mawshes of the -- marshes of the gulf coast and the delta that this mighty mississippi river built thousands and thousands of years ago, and leave it better to our grandchildren than most certainly we found it. it's been a wonderful part of my life's work. it's been a worthy project to work on. there are others that have most certainly joined me in this leadership, but i am very, very proud of the work that this senate did, and very disappointed in some things that the house did on it, but as the senator said, barbara boxer, it's legislation. and you just can't have a perfect bill. and it was better to get this than to leave it on the cutting room floor even though they did leave important pieces of it

just there. so, mr. president, i want thank barbara's staff as well, senator boxer's staff in particular. senator inhofe's staff for being so courteous. and senator boxer's staff for being very, very tenacious, petina and jason particularly to help us negotiate one of the great environmental pieces of legislation in decades. and i yield the floor and suggest the absence of a quorum. the presiding officer: the clerk will call the roll. quorum call: ms. landrieu: i ask unanimous consent --. the presiding officer: the senator from lazy. ms. landrieu: to dispense with the quorum call. the presiding officer: without objection. ms. landrieu: i ask the senate

proceed to immediate consideration of s. con. res. 61, the adjournment resolution submitted earlier today. the presiding officer: the clerk will report. the clerk: senate con ciewnchts resolution 51, providing for the conditional adjournment or recess of the senate and adjournment of the house of representatives. the presiding officer: without objection, the senate may proceed to the motion. ms. landrieu: i further ask that the concurrent resolution be agreed to, the motion to reconsider be laid on the table with no intervening action or debate. the presiding officer: without objection. ms. landrieu: i suggest the absence of a quorum. the presiding officer: the clerk will call the roll. quorum call: ms. landrieu: mr. president, just one minute, please. i'd like to dispense with the quorum call. the presiding officer: without objection. ms. landrieu: i knew i was going to forget something.

i forgot to thank my own staff which would be very important to do. elizabeth winier, elizabeth c cradick, jane campbell and my entire staff for their tremendous work. we're going to get a good rest. other staff, tanner johnson, particularly, no longer with my staff but put the original bill together. thank you, mr. president. i suggest the absence of a quorum. the presiding officer: the clerk will call the roll. quorum call:

quorum call:

quorum call:

quorum call:

quorum call:

officer the majority leader is recognized. mr. reid: i ask that the

quorum call be terminated. the presiding officer: without objection. mr. reid: mr. president, we're a on the motion to proceed to calendar number 341, is that true? the presiding officer: the senator is correct. mr. reid: i have a cloture motion at the desk. the presiding officer: the clerk will report. the clerk: cloture motion: we, the undersigned senators, in accordance with the provisions of rule 22 of the standing rules of the senate, do hereby move to bring to a close debate on the motion to proceed to calendar number 341, s. 2237, the small business jobs and tax relief act, signed by 17 senators as follows: reid -- mr. reid: i ask unanimous consent that the names not be read. the presiding officer: without objection. mr. reid: i ask unanimous consent that the mandatory quorum under rule 22 be waived. at 2:15 p.m. tuesday, july corks there will ten minutes equally divided between the two leaderss or their designees prior to a vote on the motion to proceed to s. 2237.

the presiding officer: without objection. mr. reid: i ask unanimous consent that on tuesday, july 10, 2012, at 11:30, the senate proceed to executive session to consider nomination calendar number 661 there be 30 minutes of debate equally divided in the usual form, following the use or yielding back of time, the senate proceed to vote on that matter with no intervening action or debate, the motion to reconsider be considered made and laid on the table, there be no intervening action or debate, that no further motions be in order, that any statements be printed in the record, and president obama be immediately notified of the senate's action and the senate then resume legislative session. the presiding officer: without objection, so ordered. mr. reid: i ask unanimous consent the senate proceed to executive session and the foreign relations committee be discharged from further consideration of presidential nomination 1680, that the nominationes be confirmed, the

motion to reconsider be laid on the table, there be no intervening action or debate, no further motions be in order to the nomination, any related statements be printed in the record, and president obama be immediately notified of the senate's action. the presiding officer: without objection. so ordered. mr. reid: i ask unanimous consent that the committee on commerce be discharged from further consideration of presidential nomination 442, 4 461, 462 -- that's 442, 461, 462, 1671, 1377, and 1734, that the nominations be confirmed, the motion to reconsider be laid on the table, that there be no intervening action or debate, that no further motions be in order to the nominations, and any related statements be printed in the record, that the president be immediately notified of the senate's action. the presiding officer: without objection, so ordered. mr. reid: i ask unanimous consent that the senate proceed

to consider calendar number 726, 764, 765, 766, 767, 768, and 769, 770, 771, 772, 773, 774, 775, 776, 777, -- no, skip -- erase 777. it doesn't fit in here. 778, 819, 820, 821, 822, 823, and 824. to the nominations be confirmed en bloc, the motion to reconsider be laid on the table, with no intervening action or debate, no further motions be in order to any of the nominations, and that any related statements be printed in the record and the president be immediately notified of the senate's action. the presiding officer: without objection, so ordered.

mr. reid: i ask unanimous consent the homeland security and government affairs committee be discharged from further consideration of presidential nomination 1121, the nomination be confirmed, the motion to reconsider be laid on the table, with no intervening action or debate, that there be no further motions in order to the nomination, any relates statements be printed in the record, the president be immediately notified of the senate's action and the senate resume legislative session. the presiding officer: without objection, so ordered. mr. reid: i now ask, mr. president, we road to a period of morning business with senators permitted to speak up to ten minutes each. the presiding officer: without objection. mr. reid: i ask consent that the senate proceed to consideration of calendar number 1664. the presiding officer: the clerk will report. the clerk: h.r. 6064, an act to provide an extension of federal-aid highway and so forth and for other purposes.

the presiding officer: without objection, the senate will proceed to the measure. mr. reid: i ask unanimous consent the bill be read three times, passed, the motion to reconsider be laid on the table, with no intervening action or debate, any statements relating to this habit placed in the record at the appropriate place as if given. the presiding officer: without objection, so ordered. mr. reid: i ask unanimous consent that the senate proceed to calendar number 437. the presiding officer: the clerk will report. the clerk: calendar number 437, s. 2165, a bill to enhance strategic cooperation between the united states and israel and for other purposes. the presiding officer: without objection, the senate will proceed to the measure. mr. reid: mr. president, i further ask that the committee-reported substitute amendment be agreed, the bill as amend be read a third time, passed, the senate proceed to a vote on passage of that bill as amended. the presiding officer: all in favor say aye. those opposed, no. the ayes appear to have it. the ayes have it. mr. reid: thanks mr. president. i ask that the motion to

reconsider be laid on the table,. the presiding officer: without objection. mr. reid: any statements be print ed in the record at the appropriate place as if given. the presiding officer: without objection, so ordered. mr. reid: i ask consent -- did i interrupt? no? sorry. i ask unanimous consent that the veterans' affairs committee be discharged from further consideration of s. 3238. the presiding officer: the clerk will report. the clerk: s. 3238, a bill to designate the department of veterans affairs community-based outpatient clinic at mansfield, ohio, as the david f. winders department of community a affairs community-based clinic and for other purposes. the presiding officer: without objection, the committee is discharged and the senate will proceed to the measure. mr. reid: i ask unanimous consent that the bill be read three times, passed, the motion to reconsider be laid on the table, with no intervening action or debate, and any related statements be printed in the record as if read. the presiding officer: without objection. so ordered. mr. reid: i now ask unanimous

consent that the judiciary committee be discharged from further consideration and the senate proceed to s. res. 376. the pres the presiding officer: the clerk will report. the clerk: senate resolution 376, commemorating the 225th anniversary of the signing of the constitution of the united states, and so forth and for other purposes. the presiding officer: without objection, the committee is discharged and the senate will proceed to consideration of the measure. mr. reid: i ask unanimous consent the resolution be agreed to, the preamble be agreed to, the motion to reconsider be considered made and laid on the table. the priding officer: without objection, it is so ordered. mr. reid: i ask now unanimous consent the senate proceed to s. 3363. the presiding officer: the clerk will report. the clerk: s. 3363, a bill to provide for the use of national infantry museum and soldier center commemorative coin surcharges, and for other purposes. the presiding officer: without objection, the senate will

proceed to the measure. mr. reid: i ask unanimous consent the bill be read a third time, passed, the motion to reconsider be laid on the table, and any statements related to this bill appear in the record at the appropriate place as if read. the presiding officer: without objection, so ordered. mr. reid: i ask unanimous consent the senate proceed to calendar number 439. the presiding officer: the clerk will report. the clerk: calendar number 439, s. 2239, a bill to direct the head of each agency to treat relevant military training as sufficient to satisfy training for certification requirements for federal licenses. the presiding officer: without objection, the senate will proceed to the measure. mr. reid: i ask unanimous consent the committee-reported substitute amendment be agreed to, the bill as amended then be read a third time, passed, the motion to reconsider be laid on the table, there being no intervening action or debate, that any statements related to this matter be placed in the record as if given. the presiding officer: without objection, so ordered. mr. reid: i'm told that h.r. 4018 is due -- i'm sorry, that

it is due for its first reading. the presiding officer: the clerk will report. the clerk: h.r. 4018, an act to improve the public safety officers benefits program. mr. reid: mr. president, i would now object to my request for a second reading. the presiding officer: objection is heard. the bill will be read for the second time on the next legislative day. mr. reid: mr. president, i ask unanimous consent that friday, june 29, through monday, june 9, the majority leader and senator cardin be authorized to sign dually enrolled -- duly enrolled bills or resolutions. the presiding officer: without objection, so ordered. mr. reid: i ask unanimous consent that notwithstanding the upcoming recess or adjournment of the senate, the president of the senate, the president pro tempore and the majority and minority leaders be authorized to make appointments to committees, boards, conferences and interparliamentary conferences authorized by law authorized by concurrent action of the two houses or by order of

the senate. the presiding officer: without objection, so ordered. mr. reid: i ask unanimous consent that when the senate completes its business today, it adjourn and convene for pro forma sessions only, with no business conducted. the presiding officer: without objection, so ordered. mr. reid: mr. president, we'll start over on this. i ask unanimous consent the senate -- when the senate completes its business today, it adjourn and convene for pro forma sessions only, with no business conducted on the following dates and times, and that following each pro forma session, the senate adjourn until the next pro forma session. tuesday, july 2 at 12:00 p.m. friday, july 6 at 12:00 p.m. that the senate adjourn on friday, july 6, until 2:00 p.m. on monday, july 9, unless the senate has received a message from the house that it has adopted s. con. res. 51 which ised adjournment resolution. if the senate has received such a message, the senate adjourn until monday, july 9, at 2:00 p.m.

under the provisions of s. con. res. 51, that following the prayer and pledge, the journal of proceedings be approved to date, the morning business be deemed expired, the time for the two leaders be reserved for their use later in the day. that the majority leader be recognized and the senators permitted to speak for up to ten minutes each. the presiding officer: without objection, so ordered. mr. reid: mr. president, as previously announced, there will be no roll call votes on monday, july 9. the next roll call vote will be at noon on tuesday, july 10, in a confirmation of the nomination. if there is no further business to come before the senate, i ask that it adjourn under the previous order. the presiding officer: the senate stands adjourned until tuesday, july 2, at 12:00 p.m., unless the senate receives a message that the house has agreed to s. con. res. 51, in

which case the senate stands adjourned until 2:00 p.m. on monday, july 9. adjourn:

as to eleanor roosevelt can i pray for you and she says no, we need to pray for you. >> the meeting hall much larger than this one to get all of the people in the vice presidency to that year. >> and their ideals. >> calvin coolidge may indeed have been the last jeffersonian who as president believes strongly enough in the love met of the government of power and federal power to resist the temptation to extend it.

>> this is the conversation in this country nobody is willing to have. what role should the government play in housing finance? if it's something we should subsidize, then put on the balance sheet and make it clear and make it evident and make everybody aware of how much it is costing. but when you deliver through these third party enterprises, fannie mae and freddie mac when you deliver the subsidy through a public company with private shareholders and executives who can extract a lot about subsidies for themselves, that isot a very good way of subsidizing homeownership. i think we've seen that at the end of the movie in 2008.

>> an update on implementing portions of the dodd-frank financial regulation law. the house financial services subcommittee on insurance, housing and community opportunity yesterday looked into the house and appraisal process. they are from federal officials who are writing new regulations on appraisals as a result of the 2008 housing crisis. this hearing is about two hours. >> this hearing on the subcommittee on insurance housing and community opportunity will come to order. opening statements will be made part of the record and without objection all members of bunning records will be made a part of the record. and i will yield myself as much time as i may consume for an

opening statement. >> we want to welcome the witnesses to fit today's hearing is appraisal for sick of the delivery impact on consumer and businesses. i'd like to say that timing is everything and i hope some of our members will be here shortly to find out what's going on at other places. we are examining how appraisal related provisions in the dodd-frank act and other regulatory initiatives have affected consumers in the real-estate industry. this hearing is a continuation of the subcommittee's oversight work related to the mortgage origination process. a key element of a vibrant and sound housing market is effective appraisal regulation. regulations should facilitate robust competition among industry participants and ensure transparency and integrity throughout the mortgage

origination process while giving law enforcement officials the necessary tools to read out bad actors. a prison regulations and placing unnecessary burdens on business and most importantly benefits consumers. today's hearing will examine the federal and state rules and appraisal regulation. we also explored the suggestions to improve the appraisal regulation structure and regulations. for example, can we make more efficient, consistent and effective appraisal oversight by streamlining regulations and redundant efforts to monitor the appraisal industry. finally, some mortgage industry participants raise concerns about concentration in the appraisal industry as well as the quality and accuracy of appraisals. how can the regulations integrity among the appraisers and insure the accuracy and appraisal valuation? given the broad interest in the issue of the appraisal regulations, i would like to hold at least a second hearing

during the 100th of congress on the subject to hear from other stakeholders. as i look forward to hearing from today's witnesses. i hope today's hearing will provide members of the subcommittee with a variety of ideas as to how appraisal regulation can be improved for both consumers and businesses. i'd like to recognize our ranking member the gentleman from illinois mr. didier as for his opening statement. >> thank you very much for using and for holding the hearing. as we proceed with the systemic system in housing finance reform, it has become increasingly clear that we will benefit greatly from a clearly defined well regulated system of property appraisal. in other words involved in the real-estate market from consumers and benefits and a clear and level playing field in the appraisal system. i look forward to hearing about the gao, what they found in studies specifically the weaknesses that identify and

have limited the appraisal subcommittee effectiveness. specifically the weak enforcement tools and reporting procedures and edition. whether the afc is addressing the requirement to create and operate a national hot line of noncompliance with appraisal dependence standards and uniform standards of professional process these. i look forward to learning more about the concerns of appraisals from their representatives organizations from the management companies not only on the a devotee of experience to make a living, but on the quality of the appraisals that the impact housing and financial specifically consumers. madame share it's important to understand the concerns of other stakeholders such as realtors and regarding this. other aspects of appraisal issues. most important to me and i think many of our colleagues on this side of the high level to learn how these appraisal issues are affecting consumers including whether or not the consumers are receiving their money's worth in terms of quality they pay for.

are they being fully informed of what they are paying for and are they protecting? do they have the proper means to address? thye understand there is much to cover in this hearing coming and this is only another step in the examination of this critical issue. that's why i think you can yield back the balance of my time. >> thank you. the gentle lady from west virginia is recognized for two minutes. >> thank you, madame chair and the ranking member. thank everybody for being here today. there's nothing going on in congress today. so, i'm glad you're here to talk about appraisals. i'd like to thank the chair for looking into this. i'm going to keep this brief. i want to take a few moments to address an issue that i have heard complaints about in my state of west virginia. i believe that the appraisal process is absolutely essential and important to the mortgage process because as we know, a sound regulatory structure in which the industry can operate and surf is of importance. i hope to get a better

clarification today as to whether the appraisals of the committee can handle the role or whether they would be better left to act as a primary regulator. my main focus is than to have a marketplace to the consumer that the consumer can access. i represent a state where home values are relatively low. we have put out a lot of foreclosures. we didn't get out like a lot of other places. and so, purchasing a home may appear to be very affordable, still strains a lot of the home budgets and i hear the folks of rising costs of appraisals and what that results in some cases are unfamiliar with the area in which there are they're making the local market even in the state like virginia may not sound like much. coming from outfits to appraise the, too often it is a totally different market. it's also 130 miles away. so if this is the case, i know that they have had an increased market share since 2008 and i'm

curious to know how it's contributed to this and putting in more increased later as that increases the cost of the appraisal to the consumer. i'm really concerned about the cost of the appraisal to the consumer and accuracy of the appraisal is essential and so i'm interested to hear the dodd-frank positions have absolutely created a more consumer friendly process were not. so i appreciate the chairman for holding this hearing and i welcome our panelists to the committee. thank you. >> the gentleman from california, mr. miller is recognized for two minutes. 64. i want to thank you for having given this morning. it's extremely important. the appraisal process was broken but to some degree it's still broken. after they passed dodd-frank i

remember arguing vehemently about the process of and in the direction that we are heading and appeared to be right as a disaster and we appealed most of that. but there is a lot lingering after that process this still having to deal without injury appraisal significant process. using the stress sales as compatibles and it creates more problems than for stressing property and we have this necessary to take place to make that a compatible property and a property that doesn't rehabilitated in those areas so there is a lot of confusion and ambiguity in the process that has to be dealt with in the new construction is another good example you are trying to compare a new home to a piece of property that is sold for less than six and rex. they are not compatible. they don't have the new standards, compliance is required by the local agencies and states that pass these

mandates on the energy efficiency the green home in california is another one that they are having to deal with that the builders are putting cost into homes many areas are demanded to do that and they can't even use the cost of those improvements. i like to enter into the record a letter from the national the association of home builders and the second from the leading builders of america. >> without objection, so ordered. >> when you talk to different groups and individuals, you don't -- you don't hire an electrical contractor to build concrete work. and you don't hire and help of local appraiser to local appraisals. you are getting them in areas sometimes they don't have expertise. you can't just necessarily not knowing in area go to computer and a pullout but a cleveland scare footage -- equivalent square footage. we found out the situation in the gcc. when the congressman kanjorski

proposed that my argument was perhaps new york is the most corrupt state in the nation but 49 others don't have those problems. and we need to allow more control. being able to take an appraisal and use it again is not available during the process we have where you were part of the base to do the appraisal but that person couldn't be taken to another lender to the work. there are areas we need to deal with if i don't think we have. we are in a recovering market and we need to do what we can to make sure that the market has an opportunity to recover. and i think until we fix the appraisal process does not going to happen. we are not doing a service to people that sell their home or are we doing a service to people that buy their home and we are doing a complete disservice to the people trying to finance and sell their homes. i think you for your generous time and i am looking forward to your testimony. >> thank you. the gentleman from texas is recognized for one minute.

>> thank you madam chair and i sincerely thank you madame chair for hosting this hearing. this is an important hearing and i would like to associate myself if i may say so with mr. miller's comment. i did not hear them in their entirety so i will not associate myself with all of them. but what i did here, i associate myself with. i would also like to enter into the record a letter from the houston association of realtors said aside by the president. actually he is the federal coordinator and also the state chair elect as well as mr. wayne the chair of the board for 2012. >> without objection. >> thank you. madame share i think mr. miller has made some three good points. we find ourselves with people making decisions that are not entirely familiar with the empirical evidence. i do believe that we have to

revisit some of these issues so as to tweak a system that we have in place. my belief is this is something that is salvageable it is something that is doable i think that we just have to find a way to work on this project and focus on the question before us. i've had an opportunity to talk to realtors, so i have some first hand information about what is going on in my city. firsthand information, i talked to many realtors about this concern. i even gone so far as to talk to people who do the actual appraisals, and the too have some concerns. so i think you for hosting the hearing and i look forward to the evidence i have to say much of it because there are many things happening today without getting into all of what is going on. but i had to be fair for this because of the importance associated with it. thank you again the balance of my three seconds.

>> thank you mr. green. we are delighted to have our panelists here today. we are going to have two panels and so we will start with panel number one. we have mr. william busheir of the government accountability office. think you for being here. mr. don rogers, president association of appraisers, regulatory officials come and the minister james, director of a prison subcommittee for federal financial institutions examination council. thank you so much for being here. without objection your statement will be made a part of the record. new weech will be recognized for five minute summary of your testimony. we will start with mr. shearer. >> remember gutierez, members of the subcommittee. >> i'm not sure if your microphone is on and if it is

belittled closer. >> can you hear me now? >> polis a little closer. it moves. >> can you hear me now. okay. i will raise my voice. thank you. german, a ranking member for gutierez and members of the subcommittee i am pleased to be here today to discuss the role of the oversight appraisal. my statement today is based on information from the two reports we issued in response to mandates and the dodd-frank act be read the first we issued on july, 2011 included an examination of the real-estate valuation methods including appraisals as well as conflict of interest and appraisal selection policy. the second which we issued in january, 2012, including the assessment of the appraisal -- >> mr. shear, it still is hard to hear. it looks like the lawyers are tight. can you move it a little bit

closer? >> let's try this. issued in january included an assessment of the appraisals of committee functions and certain challenges faced. in summary, we found that the first of results which provide an estimate of the market value at a plant in time are the most commonly used valuation methods for both mortgage originations limited we found the comparison approach is required by fannie mae, freddie mac and fha used in nearly all appraisals. we also find that the cost approach in which an estimate of the value of the land value to reproduce the residence is often used in conjunction with the sales comparison approach.

second, conflict of interest policies have changed appraisal's selection process these and the appraisal industry. specifically the policies have left to increase these prison management. in the july, 2011 report we concluded that setting minimum standards with key functions they perform on behalf of lenders that enhance the appraisal and provide greater assurance and credibility and quality of the appraisals provided by amc. therefore we recommend that these regulators consider adopting several key areas including criteria for selecting appraisals, part of the joint rulemaking of the dodd-frank act to set minimum standards with states to register a emc. now i will briefly discuss the valuation of the appraisals of the committee. it's been performing the role under title 11. we find that several weaknesses which are generally the lack of

a stop watch policy procedures and clear definitions that potentially limit the effectiveness. we recommended that to clarify the criteria used to the compliance with title 11 and develop specific policies and procedures by monitoring the federal regulators and the empirical foundation. we are taking steps to implement these recommendations. german bigger and ranking member gutierez come this concludes my prepared statement. i'd be happy to answer any questions. >> thank you so much. mr. rogers, you are recognized for five minutes. >> madam chairman and ranking member gutierez and members of the subcommittee, thank you for the opportunity to testify today. im the exit of director of the board and i am currently the president of the association of the regulatory officials which comprises of the real-estate licensing agencies.

my testimony today will focus on issues that are particularly relevant to the state regulators like the resources. state appraisal licensing programs were established as a result to issue the credentials and oversee compliance by the standards and state law. some programs are part of town all what agency to handle the wild life in the state. they often use the investigators in the legal counsel on the basis. others are stand-alone agencies that handle the uprising in door real estate. they may have contractors of investigators and four part-time legal assistance. finally, the state such as north carolina that have an autonomous board to set up by the state statute. the boards to not receive state funding and typically they hire their own staff often they lack sufficient resources and not able to comply with federal requirements. they do not understand why this program must be given priority when the backlog for other agencies is just as great. on the issue of appraisal fraga,

the appraisal is an opinion of value which makes it difficult to show that the appraiser intended it to deceive someone. for this reason, law and was not officials often shy away from bringing fraud charges. although state and federal law enforcement have joint task forces with state regulators they are often not able to share information due to concerns that their investigations could be compromised. appraisers are not usually the originator of the schemes that are brought into it with a promise of future assignments. instead of large payments which would provide the smoking gun tying them to the fraud. appraisal management companies. aamc existed for many years as a result of the holmdel eurasia and conduct, many more were established. there were however no regulations in place to finding the anc or controlling those that own or operate amc. often the cruisers are prohibited from speaking with brokers and builders are borrowers. this creates consumer frustration directed towards

appraisers as consumers are not aware of the role of the appraisal process. appraisers have their own issues including numerous assignment conditions requested beagle outside of their market and dealing and receiving payment. the frequent problem for the regulators is they must license to entities whose interests are often at odds. each group may attempt to change the law and rule that impact the other of the body to function. owls dhaka, plants increase against aamc the states like the resources to investigate our of state companies that have substantial legal resources of denney value rates of the services. the price opinions endeavor evaluation products are generally not regulated by the licensing boards. consumers do not realize the difference and they think they are receiving an appraisal in an appraisal wasn't involved in the process. there is limited authority to discipline these valuations, and they are not sufficiently

regulated. evaluation of the regulatory system some cooperative efforts between the state boards, the anc and the appraisal foundation or an investigator to enter and provided at no cost to the states, task forces on trimming supervision and consistent enforcement. the foundation requests comments from the proposed changes for the appraisal qualification criteria and schedules meetings to coincide with the conference is. does that attends the foundation meetings and assists the states stretching rules and regulations. the continued however to be areas that show the need for improving. state regulators should be represented on the appraisals of committee as well as the foundation's board. there should be a national repository for the appraiser records even for expansion of the national registry or the system somewhat to the national mortgage licensing system. current meeting procedures describes the public from attending. universal opposition and

complete forms have been discussed difficult to achieve absent federal requirement. it's been in the process of changing its policy statements for several months. the states haven't had the opportunity to see the draft or to comment. the lack of enforcement sanctions with seeley is a mission created a situation where the recognition was the only penalty available for the violations. the dodd-frank act is given broad of first options to make grants to the states and oversight of the amc process. it remains to be seen what will have on the state. thank you for the opportunity to testify before you today. i will be glad to answer any questions. >> thank you. you are recognized for five minutes. >> good morning jarman bigger, ranking member gutierez and members of the subcommittee. thank you for the opportunity to update you on the board of the appraisals of the committee also

known as the asc. title xi created the asc as an independent agency within the federal financial institutions of the council. title xi was passed following the savings-and-loan crisis of the 1980's to address weakness is regarding the real property appraisals in connection with federal leave related transactions. title u.n. called for this double schmidt of the state programs to credential and supervise appraisers and created a unique regulatory framework that involves federal, state and private entities. at the federal level we have the asc at the state level estate appraisal regulatory agencies and on the private side of the appraisal foundation. the asc is made up of seven members designated by the head of the federal financial institution regulatory agencies as well as fha and the thus efp. last january this efp be appointed its first representative to the afc. effective april 1st they

appointed the hud representative as the new chairman who was also a certified appraiser in the first appraiser to share the wealth afc. agencies remain committed to fulfilling the statutory responsibility. as part of its core responsibilities, the asc monitors the state regulatory programs for compliance with title 11. the completed 27 reviews in 2011 and 31 are planned for 2012. the asc also maintains a national registry comprised of appraisers eligible to perform appraisals for the federally related transactions. the registry contains fewer than just 105,000 credentials down almost 14% from the peak in 2011. the register being the sole source of revenue and reduction of the number of credentials comes at a particularly challenging time as the scope of responsibility is increasing due to the dodd-frank act. in monitoring the foundation,

asc evin all meetings of the foundation boards. for fiscal year 2012, the asc approved a grant of approximately $900,000 to the foundation. the grand includes funds for the state investigated training programs which as been beneficial to the states. through our monitoring, the asc is aware the foundation is currently working on a new strategic plan. they played no role in the development by the strategic plan. however, when made public the asc will review and possibly comment on matters related to the asc responsibilities. the asc continues to make progress in addressing the dodd-frank act requirements. that fall they approved a plan to establish the appraisal complete national hot line and a great deal of work has been completed towards its implementation. asc member agencies are currently working to finalize the details for internal complaint in take this position. the launch of a hot line is anticipated before the end of

2012. the dodd-frank act also requires the gao to conduct a study. in its report issued last january, the gao made three recommendations. first, gao recommended that the clarify the definition is used to categorize the states' compliance for title xi. in response, the clarified the definitions which are now incorporated into all appropriate documents. the asc also drafted the revised policy statements that have been approved for publication in federal registers to solicit public comment. the revisions and putting new findings in the definitions to further address the gao recommendation. second coming gao recommended that the asc develops was the policies for monitoring the appraisal requirements developed by the federal financial institutions regulators. finally, gao recommended that the developed the specific policies for determining whether the foundation's grant activities are related to title xi. the staff policies for asc

approval to address the last few recommendations. other asc proprieties include the response of the these inferred by the dodd-frank act with such areas the state grants and rulemaking. regarding the state grants, many state appraisal programs do not control their funds. therefore the asc will focus on insuring a grant funds are used to support the program. while the asc hasn't formally addressed the rule making the proposed policy statement would implement the interim sanctioning authority given to the asc by the dodd-frank act to remove the appraisers from the national registry for up to 90 days. the use of any additional internals and sharing authority would require rulemakings. in conclusion, i again appreciate the ever to be to appear before the subcommittee and look forward to addressing the question. thank you. >> thank you mr. park. this is the time when the members of the committee will ask questions and i hear.

i will start. [laughter] i will yield myself five minutes mr. shear, do you think that the asc has made efforts to reform its policies and procedures for determining whether the activities of the foundation of our title xi related? >> as mr. part said, you know, we follow that and we know that they have made process in this area as far as coming up with a definition that would be how do you define title xi? we know they are making progress in this area. >> do you think they are going to have enough? >> we are very glad that they agreed with our recommendations and that they are putting things

down in a formal way to address these issues. >> according to your testimony and based on your july, 2011 report, the appraisals of the committee has not clearly defined the criteria that uses to assess the state overall compliance with title 11. could you expand on this assertion? >> i would be glad to. one thing that we have observed over the year is that the compliance with the oversight from state compliance with requirements have been enhanced over the years. so we see that and we see the establishment of many policies and procedures that are clearly stated that from an internal control standpoint we just dealt with three different categories that it would seem greater clarity and would provide for more robust oversight if the

three categories or whenever category they have are defined, and the understand that they are making progress in this area. >> thank you. >> mr. rogers, once you provide some suggestions on how the appraisal regulatory structure can be improved at the state and national level. can you describe some of those suggestions for the committee. >> in looking at the areas of improvement, as mr. park said in his testimony the policy statements are given to the states to follow to show compliance with title 11 are in the process of being revised. at this point we don't understand it be in for several months have yet to any exposure

in the state's or half the states comment. when the foundation made changes to the standards or criteria there is a robust bidding process that allows a lot of unintended consequences, so i would encourage the subcommittee to get those to the states for comment as soon as possible. also we believe the state's should have representation both on the subcommittee as either a member or through some sort of liaison and have the same representation on the standards and qualifications boards. these words directly affect policy rules for each of the state's and for them to understand what impact or whether unintended consequences might come by the result of changes to the rules of regulation as essential. so we think that is a very

essential point. with regard to the public meeting of the subcommittee, the process is very rigorous to try to attend you have to register in advance, have a photo id, go through a security process and you have to be escorted to and from the meeting site. this is largely because they are held in offices of the financial institution. so it is understandable the level of security needed in those buildings we would suggest it should be held somewhere for the public to come without pre-registration in our state to come to a public meeting you can walk right in and so we would suggest that as well. that's just some of my suggestion. >> i would yield such time as i may consume for additional

questions. mr. rogers, they're seems to be a great number of the industry participants who claim that realistic appraisal for all this significantly increasing does your appraisal data reflect or dispute this claim >> just speaking for my individual state, we have not seen a large increase in the appraisal fraud. i think a lot of the schemes that were taking place in the early part of this last decade are difficult to perpetrate given the financial climate we're in now. the rapidly inflated markets made it easier to perpetrate we're now but certainly doesn't take place. we have what is now called swaping the schemes where it is

misrepresented to the lending institutions. they should sell for low amounts and then some of the real-estate professionals sold the property at a large profit to kind of reverse the flipping scheme. we have seen some cases in our state which were right in the middle of the transition to the economy following where there were subdivisions and a lot of promises were made and no money down type of investment a lot of people bought for investment type properties and the the market crash. some of them were in the fact that they were trying to entice people into making poor investment choices with actual markets fell out from under them which was not a part of the scheme.

>> response to the savings and loan crisis in the late 1980's and the early 1990's in light of the significant changes over the past 20 years shall what were some of the asc in today's market? >> the relevance of the asc -- >> can you pull it closer, thank you. >> the relevance of the asc is the federal oversight that we provide for the states as well as monitoring the foundation and the gransta are provided to the appraisal foundation for the work of the appraisal standards board and qualifications board.

>> do you think the 21st century as far as the federal oversight? >> title xi is originally enacted and has some flaws. the dodd-frank act attempted to correct some of those providing more authority and responsibility to the appraisal subcommittee. while many of those provisions of the dodd-frank actor still being put into place, they should still assist the subcommittee in providing greater regulatory oversight for the appraisal regulatory system. >> mr. shear, do you think that there should be a complete overhaul to make sure that it is in the 21st century? >> we don't look at the various options for restructuring so i

can't answer your question directly. we did look at how dodd-frank changes the appraisal subcommittee and we think the appraisal subcommittee has some huge challenges ahead as they move for implementing our recommendations and taking other actions to but i would expect this committee and others would be taking a very close look to see whether the appraisal committee has the resources and right type of structure to carry of these additional responsibilities especially pertaining to monitoring the financial regulators. >> mr. park you know the asc failed to detect a significant amount of a breeze unfurled during the financial crisis a lot of other people made a lot of mistakes, too but do you

think because of that the states could assume some of the role of the asc? >> the role of the asc is not to detect appraisal fraud. that is the realm of the states. they are the enforcement mechanism of the system. the asc role was to create an environment where fraud can be easily detected and then the states have the ability to enforce disciplinary actions for fraud or lesser offenses misleading appraisals and so forth. >> was there a problem with the environment than that the asc created at the time of the financial crisis. >> title xi within the authority that it's given. one of the problems, one of the

inherent problems that dodd-frank tried to correct is that the only disciplinary authority that the subcommittee has to use against states that were out of compliance was not recognition of the state program, nonrecognition of the state approval program was shut down mortgage lending in the state. while it's been addressed with many states are several states and say no that is the potential outcome of the compliance reviews they often know that it is a very draconian measure. >> you said you don't detect the fraud but house asc put out any information about the trends and work with the states to better address fraud? >> the policy managers but

actually come and conducted the review say to gather information about whether what they are doing related to the fraga more and more states and some are getting involved in mortgage fraud committees and working with the fbi federal government and state government officials to address the problem of mortgage fraud appraisal fraud. >> do you think that this has happened in your state? >> i agree there have been efforts on the subcommittee refuse issues that occur in other states were certainly made available aware of other states who joined the investigator and has been diluted to allow the regulators to attend at no cost,

and to focus on some of these issues that you may seek. as i pointed out in my testimony in dealing with law enforcement officials, one thing is they have to have a fairly substantial threshold of financial harm before they can become interested in a per patrician. and when they have participated in task forces which i think have been useful in helping identify the players and in some of these mortgage frauds to be shared both ways because they're in a criminal investigation. the licensing investigation may compromise their criminal the investigation. >> i'm in a very generous mood.

my prescriptions are ready. i want to let the panel know we have an appointment you can keep it. pre-existing conditions will not be counted against you. you've got your kids on health care is okay. it's the law of the land so i feel pretty good about that for that little aside but i thought you might want to know what the supreme court has just decided. i am not talking to the rest of you. i am very well informed of what happened. the very distinguished and welcome to witness is here this morning. so, mr. shear. as we continue to look at the comprehensive policy reform a key element missing from the d-day is comprehensive appraisal reform. i think that should be to the appraisal system which produces accurate values through all phases of the housing.

and the agency guidelines that became effective december, 2010 to the 2004 guidance but it was limited. as we confront the major systemic hurdles to the appraisal reforms, specifically the fragmented and what we consider, some of us consider the dysfunctional preshow system and the regulatory oversight, the question is who has the authority and more importantly, the ability to coordinate and implement the changes we need to accomplish? >> you raise really good questions. there is room for improvement on the appraisal subcommittee in a particular the new authorities of responsibility provided by dodd-frank allow the appraisals of a committee to do a better job of trying to oversee the state regulators. we also think it's very important, and also a huge

challenge for the appraisals of committee to try to come up with a play of monitoring the federal financial regulators given the structure. so there is an awful lot that seems to be riding on what the appraisals of committee is doing, but i think the kind of questions you ask are very good questions because even if the appraisal subcommittee does implement new procedures and implements new authorities and takes on the new responsibilities, they're still is the question of how comprehensive a system that we have. based on our work i think that those are very good questions that become very much a part of the whole mortgage reform under dodd-frank. >> can you help us a little more? >> i think there are two questions with regards to the

question has been raised about dealing with appraisal for what it is a joint work with law enforcement and it largely the complaints and the comment i've heard from the members here today had to do the accuracy of the evaluation and helping them recover from the housing crisis situations like that. peery on the state level you are dealing with a complete system where the board receives a complaint and then it falls under the system for example in our state immediately the respondent has 30 days to respond to complete before we even initiate the investigation. in the marketplace they need somebody that wants to appraisal to not meet their needs and need

the ability to appeal or did it revisited or reviewed. i think that will have to be handled largely in the lending committee. >> could i ask you to restate your question? >> we have effectiveness of the system to change and to improve and have no effective standards across the country. we changed them. how do you see the standards changing quickly enough are they being adopted quickly enough? >> the changes to the appraisal regulatory system have occurred very slowly. a the dodd-frank act is the first significant change since it was enacted in 1989. so there has been -- the dodd-frank act did install quite a few significant changes that we talked about earlier in terms of the subcommittee of three -- >> do you think they are

actually being carried out effectively? >> yes we are in the process of enacting the different provisions of that changes the amendment to title xi that were a part of the dodd-frank act and we have already made changes in terms of, for example, the subcommittee didn't have the authority other than to comment that we have no authority during the compliance process to look at the funding and staffing of the state program. dodd-frank gave the subcommittee the authority to do that as a part of your compliance review process. >> thank you so much we will have more questions for you and thank you for your testimony today because maybe it is just my imagination by the limited to appraisers i remember meeting one like 25 years ago and you know, it's like you tell the

mechanic what you think might be wrong, the contractor comes over to fix something and it's like the last time i have the appraisal come over it was almost like i was doing a criminal act by telling her before i installed it, told her what it was about my home that made my home unique so that she could do a better appraisal. when i talked to the mechanic he kind of listened to me fix my car but it doesn't treat me like a criminal trying to tell him what i think is wrong or good or bad about my car. i hope they don't get to the point where you get into an adversarial relationship between a homeowner and a prized possession and make an objective determination, but you can still get good information i think from the american public you make a decision about what it is something has worked i think all

of you and look forward to the next panel. >> i would like to thank the panel for their expert testimony and for being here. it's been very helpful to us. with that, we will excuse the panel. the first of all, let me just say that the chair notes that some members may have additional questions for the panel which they may wish to submit in writing and without objection the hearing record will remain open for 30 days for members to submit written questions to the witnesses for their response in the record. thank you very much. >> with that, we will have the second panel come forward.

>> i would like to recognize the second panel and thank you all for being here. let me just go through the list. we have mr. david, chief program officer national committee reinvestment coalition. think you for being here. mr. benton the appraisal foundation. thank you. and mr. francos did not deal with international association of realtors appraiser committee. thank you for being here. mr. don kelly, executive director real estate fell you ration advocacy association. on behalf of the coalition to facilitate the prisoner integrity reform. ms. karen admin, president

associate appraiser on behalf of the american society of the appraisers and ms. sarah stevens, the president appraisal institute. thank you all. we will begin with the testimony and without objection you're written statements will be made a part of the record. you will be recognized for a five minute summary of your testimony and with that we will start with you. you're recognized for five minute. >> other distinguished members of the committee my name is david and i am the chief program officer for the national committee reinvestment coalition. on behalf of our coalition, i am honored to testify before you today for both the consumer protection and the safety and soundness perspective in order to discuss options for improving the regulatory oversight of the stakeholders and the home valuation and housing finance industry. ncrc